Central London property top of overseas investors’ wish lists

Overseas investors continue to dominate London’s property market – with 77% of Central London investment in Q1 2013 coming from overseas money, according to new research by BNP Paribas Real Estate, the leading property adviser.

Within the London submarkets, 86% of City investments in Q1 2013 came from overseas money and 62% of investments into the West End market were also from overseas buyers.

Interestingly, the majority of overseas investors are from Europe (outside of the UK), accounting for 27% of overseas investment into Central London during the first quarter, followed by North Americans, who accounted for 25%. Other regions also investing include the Middle East, which accounted for 18%, and the Far East, which accounted for 17% of investment.

Positively, total investment into the Central London property market rose 9% to £2.91bn in the first quarter of 2013, compared with Q4 2012.

When analysing each submarket, investment into the City remained fairly stable in Q1 2013 at £1.3bn and the Docklands saw a rise in investment, with the largest deal being at 5 Canada Square. Elsewhere, Midtown investment levels dropped in the first quarter to £170m and also fell slightly in the West End to £930m.

BNP Paribas Real Estate’s senior director of London investment, Richard Garside, said: “Demand remains as diverse as ever with a continued high level of activity from overseas money driven by the focus on London as a safe haven with high quality investment stock. UK institutional investors also remain active within in their traditional sectors and we are seeing a continued demand for annuity style income often provided by alternative sectors such as student housing, hotels, supermarkets and datacentres.”

Please note: These figures relate to our classification system. For the City we include postcodes E1, EC1, EC2, EC3 & EC4, for the West End we include postcodes W1, W1, W8, SW1, SW3 & SW7, for Midtown we include postcodes WC1 & WC2 and for the Docklands we include postcodes E14 & E16.